Remittances to Mexico continue record-breaking trend

Mexican families received a record high of US $48.3 billion from abroad during the period from January to October. The number represents an increase of 14.6% over the same period last year, data from the Mexican central bank showed on Thursday.

The figure also marks 30 months of sustained increase with highs recorded in May ($5.142 billion), June ($5.144 billion) and September ($5.3 billion). In October alone, the number of remittances was US $5.35 billion — 11.25% more than the amount of US $4.81 billion registered in the same month of 2021.

In total, 124 million operations were registered between January and October, mostly electronic transfers.

Remittances, mainly from Mexican migrants in the United States, represent the country’s second-largest source of foreign revenue after automotive exports. It also accounts for more than the Mexican agricultural sector, which contributes 3% to the gross domestic product.

In a study conducted by the Wilson Center, Mexico ranked as the third-largest recipient of remittances in 2021 behind China and India. A whopping 94% of remittances come from the U.S., with California, Texas and Minnesota being the largest sending states.

At a time when President López Obrador is struggling to grow the economy, data from the Center for Latin American Monetary Studies (CEMLA) shows that nearly 4.9 million Mexican families and some 11.1 million adults receive remittances from their relatives abroad.

López Obrador has often boasted about the strong growth in remittances sent to Mexico and has called all 38 million Mexicans in the U.S. “living heroes” for the money they send back home. Before year-end, the President forecasts remittances to reach US $60 billion and has expressed trust that remittances will help lift the country’s economy, which registered a contraction of 8.2% in 2020 and a recovery of 4.8% in 2021.

Remittances are often sent once a month to Mexican households, an income that is mainly destined to food, clothing, and family health care. Other expenses of remittances include purchase of land, payment of debts, education expenses for household members and housing or household goods.

With reports from Swiss Info and Bloomberg

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